Intermountain Health’s Operating Income Slips To US$121M During A High-Cost, High-Growth 2022
By Dave Muoio
Intermountain Health had a busy year with its SCL Health merger, which pumped up revenues and brought a US$4.1 billion affiliation contribution that allowed the nonprofit to avoid reporting a net loss. (Intermountain Healthcare)
Rocky Mountains-based Intermountain Health closed out its merger year with a US$121 million net operating income (0.9% operating margin) and more than US$3.1 billion in additional revenues, according to its consolidated financial statements.
The 33-hospital nonprofit reported a net profit of US$2.6 billion, though that includes nearly US$4.1 billion in affiliation contributions from the combination with SCL Health that closed last April. That deal, announced in September 2021, added eight hospitals to Intermountain’s total.
Though its scale has expanded thanks to the merger, the latest numbers reflect a performance decline from 2021 when the system’s net operating income landed at US$658 million (6.1% operating margin).
Total revenues increased 29.6 per cent year over year from 2021’s US$10.8 billion to 2022’s US$13.9 billion.
Expenses, meanwhile, rose 36.7 per cent year over year from US$9.6 billion to US$13.2 billion, with about US$6 billion of those 2022 expenses being driven by employee compensation and benefits.
Intermountain’s bottom line took a hit from nearly US$1.6 billion in investment losses during 2022, a turnaround from the US$1.5 billion in investment income it claimed in 2021.
Intermountain spans seven western states and employs about 59,000 people across its 33 hospitals and roughly 400 clinics. As of Dec. 31, Intermountain said it’s sitting on US$792 million in cash and equivalents available for use and US$3.6 billion in long-term debt.
Outside of the merger headlines, the nonprofit saw plenty of executive transition last year after former CEO Marc Harrison (last year’s #FierceMadness winner but a first round departure in this year’s bracket competition) left the organization in August for a role at investment firm General Catalyst.
SCL Health head Lydia Jumonville steered the ship for a few months in an interim capacity before Chief Operating Officer Rob Allen was promoted to president and CEO effective Dec. 1.
Intermountain’s operating income may be a step back from 2021, but the system’s finances are still a step ahead of several other major nonprofits.
Kaiser Permanente logged a US$1.3 billion operating loss in 2022 while Providence recorded a US$1.7 billion net loss. Ascension, CommonSpirit and Trinity—which have their fiscal years on a July-to-June cycle—have each reported hundreds of millions in six-month operating losses.
